Remarks by Executive Vice-President Mînzatu and Commissioner Dombrovskis on the 2026 European Semester Autumn package

Executive Vice-President Mînzatu:

Good afternoon, ladies and gentlemen. Welcome to our College read-out.

At today's College meeting, we adopted our 2026 European Semester Autumn package. I will present this to you shortly together with Commissioner Dombrovskis, and we will reply to questions you might have on this topic.

Also at today's College meeting, we decided to register two European Citizens' Initiatives: one titled ‘EU Stars On My Passport' and another initiative titled: ‘Demand the full suspension of the EU-Israel Association Agreement in view of Israel's violations of human rights'.

Let me remind you that, at this stage, the Commission has not analysed the substance of the proposals.

Our registration means the organisers of today's initiatives can start gathering the 1 million signatures that are required for each initiative to move forward.

If the initiatives are successful, and gather the minimum support of citizens, the Commission will then have to react.

I invite you to check the press material that the Spokesperson´s Service is publishing as we speak, on these topics, for more details.

With that said, let us now move to topic of this press conference.

This year's Semester is a milestone of major importance to people.

Let me start with the main novelty of this Semester package.

For the first time, we are putting forward an EU-27 Council Recommendation on human capital, focusing on education and skills.

The reason is simple: human capital – people – are at the core of our competitiveness.

We have to look at our education systems, at our labour markets and at our competitiveness together, not in silos.

And we must take a systemic approach. Our skills needs, our labour shortages – they do not stop at the borders of our Member States.

With this recommendation, we are going beyond a country-specific approach and looking at human capital from an EU-wide perspective.

For this year, there are 4 key measures that we ask all Member States to take.

1.   Reverse the trends on basis skills. More and more of our children are weaker in the matters that are key for the future, such as maths.

We will not have AI skills if the majority of our population doesn't have basic knowledge in maths – here the curriculum must be changed, urgently.

2.   Building on that: STEM.

In AI alone we will need around 7 million workers by 2027. That's less than 2 years from now. STEM must be a priority at all levels of education.

There are many girls and women who are outside the labour market today who must be attracted as a matter of urgency in this field.

Here too, our teaching must evolve in line with technology – even be ahead of it.

This is how we achieve competitiveness. We need to be smarter than AI.

3.   Obviously this requires a lot of resources to be mobilised quickly.

But investment in education and skilling – in our people – is a joint response between private and public sector.

We invite Member States and businesses to sit together and invest together, because this is a win-win investment for society, companies and people alike.

4.   Last but not least, we want these recommendations to respond to real needs on the ground. We need to be faster and more agile. And for that, we need better skills intelligence.

We are setting up a Skills Observatory to gather that real data, and a High-Level Board to bring companies and education providers together.

They will show us where the most urgent gaps are, and help us make our systems future-proof.

In terms of next steps, this recommendation will be discussed at the highest political level

– at the Education Council in January and the Employment Council (EPSCO) in March.

My aim is that it will be also put to Heads of State and Government at the European Council meeting in March.

Once adopted in EPSCO, the recommendation will form part of our discussions with Member States in preparation of the Semester Spring Package and the country-specific recommendations.

Let me recall that this year the Semester is key for the next MFF, since the country-specific recommendations will form the basis of Member States' national plans.

So, today's recommendation on Human Capital is essential to make sure that education and skills policies will also play a central role in the discussions on the next MFF.

Finally, let me say a few words about the Joint Employment Report.

The situation did not change much compared to last year.

Job markets continue to perform strongly. But behind the positive headline figures are structural weaknesses.

Most worryingly for our competitiveness, labour productivity in the EU is stagnating and skill shortages remain high.

Now you see once again, why we need this Human Capital Recommendation and urgent action.

What also emerges from the JER is that we have an issue of the quality of our jobs.

1 in 5 workers are in low paid jobs and sectors that do not deliver on our competitiveness.

And on top of this, around 50 million people remain outside the labour market – mostly women, migrants and young people.

These problems are especially evident in some areas and regions more than in others.

The analysis of the Social Convergence Framework offers a clear overview of the situation in the EU and the worrisome divergence trends not only in adult learning but also in poverty, and especially in-work poverty.

For nine countries, the Commission will carry out an in-depth analysis of the risks and challenges to upward social convergence.

Next week we will put forward a Quality Jobs Roadmap and next year a Quality Jobs Act.

But human capital is a complex area of work – and the reforms and investment need through the European Semester are now of key urgency, as is updating our labour market acquis.

Thank you, and I now handover to Valdis.

*****

Commissioner Dombrovskis:

Thank you, Roxana. Good afternoon, everyone.

The 2026 European Semester cycle we launch today is fully focused on building a more competitive Europe.

Last week's Autumn Forecast confirms that we must secure stronger and more sustainable growth.

Given the challenging external environment, the growth impetus must come from within Europe.

This is why enhancing Europe's competitiveness, productivity and innovation remains our highest priority.

It is the key to unlocking Europe's full growth potential, securing our long-term prosperity and bracing ourselves for new geopolitical realities.

The Competitiveness Compass provides the overall roadmap to guide our work.

The 2026 European Semester will be driving the reforms and investments at national and regional levels, consistent with the Competitiveness Compass

The euro area recommendation reflects that, calling on Member States to take action to enhance competitiveness.

It includes:

• For security: addressing defence industry bottlenecks, also supporting an effective use of public funds.
• For investment: reducing obstacles by simplifying the business environment and completing the single market, while prioritising investment in research and innovation, amongst others.
• For the labour market: strengthening education and training policies as well as raising labour market participation.
• For the financial sector: completing work on the digital euro, strengthening the euro's international role, and closely monitoring financial risks.

At the same time, Member States need to continue implementing recovery and resilience plans by the August 2026 deadline.

Taken together, the implementation of these and other growth-enhancing measures at national level will complement and reenforce our efforts at EU-level to boost competitiveness.

Turning now to the fiscal elements of the Autumn Package.

We have made a good start with the implementation of the new fiscal framework. 

We now need to focus on implementation and enhancing the efficiency and quality of public spending and revenues.

This is especially important given the immense demands on public finances in a context of clear fiscal sustainability risks in a number of Member Statas.

After declining substantially in previous years, the aggregate euro area debt-to-GDP ratio started to edge up in 2025.

We therefore need to remain vigilant.

All Member States have now submitted their medium-term plans, and the Council has adopted recommendations setting net expenditure paths for each of them.

Today, we are presenting our assessment of Member States' compliance with these recommendations.

Overall, this assessment is positive.

We take into account the flexibility provided by the national escape clause.

It facilitates a rapid increase in defence spending for the 16 Member States that have requested its activation.

In particular, the Commission is presenting its Opinion on the draft budgetary plans (DBPs) for 2026 of the 17 euro area Member States that have presented them in October.

This excludes Belgium and Spain, which will present a DBP once a draft budget has been tabled in their respective parliaments.

For Austria, our assessment for 2026 was already included in our Opinion in June.

Of the remaining euro area Member States, our assessment finds that the DBPs of 12 to be compliant with the recommended net expenditure path.

These are: Luxembourg, Finland, Germany, Estonia, Greece, Latvia, Italy, Slovakia, France, Cyprus, Ireland, Portugal.

For Austria we found them compliant in June and that has not changed, and Belgium, which are compliant based on the Autumn Forecast.

The DBPs of three euro area Member States are at risk of non-compliance.

Their net expenditure is projected to grow faster than allowed.

These are: Croatia, Lithuania, Slovenia.

And same is true for Spain which was also based on the Autumn Forecast.

The Netherlands – which has an overall solid fiscal position with debt below 60% and a deficit below 3% of GDP – is at risk of material non-compliance.

Net expenditure is forecast to increase substantially faster than allowed.

This is also the case for Malta, which is currently in the excessive deficit procedure (EDP).

Turning now to the non-euro area Member States.

Five Member States – Denmark, Czechia, Poland, Romania and Sweden – are projected to be compliant.

Let me add an extra word on Romania.

Thanks to significant fiscal measures adopted over the summer, the situation has clearly improved.

As a result, the Commission will at this stage not propose a suspension of EU Funds under the macroeconomic conditionality procedure.

At the same time, the deficit is still very high and risks remain.

It is crucial now for Romania to stay the course and implement the planned fiscal consolidation measures rigorously.

Hungary, in turn, is at risk of non-compliance.

And finally Bulgaria, which will soon become a member of the euro area, is also at risk of non-compliance.

We invite the Member States where there are risks to take the necessary measures to ensure compliance.

This is particularly important for Member States under an excessive deficit procedure, where a lack of effective action, if confirmed in spring next year, may entail procedural and financial consequences.

The Commission has also prepared a report under Article 126(3) to assess compliance with the Treaty's deficit criterion, covering Germany and Finland.

Finland exceeded the 3% of GDP reference value in 2024 and plans to exceed it in 2025.

Germany also plans to exceed the reference value this year.

In the case of Germany, the small excess over 3% is fully explained by the additional defence spending.

As a result, there is no case to open an excessive deficit procedure.

For Finland, we acknowledge the exceptional circumstances that have had a major impact on Finland's public finances – namely the unfavourable economic situation as well as the urgent need to increase defence spending.

However, the deficit in excess of 3% of GDP is not fully explained by the increase in defence spending alone.

The report therefore concludes that the opening of a deficit-based EDP is warranted for Finland.

The next step, after taking into account the opinion of the Economic and Financial Committee, is for the Commission to propose to the Council to open an EDP and make recommendations for corrective measures.

Now to the Alert Mechanism Report.

We will prepare in-depth reviews for the seven Member States that were already identified as experiencing imbalances or excessive imbalances in previous cycles.

These are: Greece, Italy, Hungary, Slovakia, Romania, the Netherlands and Sweden.

No new Member State has been identified to undergo an in-depth review.

Of course, we will remain vigilant in monitoring the emergence of imbalances, especially in areas like house prices and cost competitiveness, as well as external imbalances.

To conclude, this European Semester cycle will focus on ensuring that we deliver on the priorities and promise of the Competitiveness Compass.

This will involve a deeper analysis and closer engagement to identify reforms and investments that will boost competitiveness.

The Spring European Semester Package will, on that basis, present a focused set of country specific recommendations.

I will stop here. Thank you.